ICGT.L WACC - Weighted Average Cost of Capital
The WACC of ICG Enterprise Trust PLC (ICGT.L) is 10.4%.
| Range | Selected | |
| Cost of equity | 9.2% - 12.0% | 10.6% |
| Tax rate | 19.0% - 19.0% | 19% |
| Cost of debt | 4.9% - 4.9% | 4.9% |
| WACC | 9.1% - 11.8% | 10.4% |
| Category | Low | High |
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.87 | 1 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 9.2% | 12.0% |
| Tax rate | 19.0% | 19.0% |
| Debt/Equity ratio | 0.03 | 0.03 |
| Cost of debt | 4.9% | 4.9% |
| After-tax WACC | 9.1% | 11.8% |
| Selected WACC | 10.4% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| ICGT.L | ICG Enterprise Trust PLC | 0.03 | 1.12 | 1.1 |
| ATR.L | Schroder Asian Total Return Investment Company PLC | 0.07 | 0.61 | 0.58 |
| BGEU.L | Baillie Gifford European Growth Trust PLC | 0.15 | 1.01 | 0.9 |
| BIOG.L | Biotech Growth Trust PLC | 0.23 | 0.65 | 0.55 |
| BRSC.L | Blackrock Smaller Companies Trust PLC | 0.14 | 1.37 | 1.22 |
| DGN.L | Asia Dragon Trust PLC | 0.11 | 0.63 | 0.58 |
| JGGI.L | Jpmorgan Global Growth & Income PLC | 0.05 | 0.83 | 0.8 |
| MRCH.L | Merchants Trust PLC | 0.13 | 1.37 | 1.24 |
| SAIN.L | Scottish American Investment Company P L C | 0.11 | 0.86 | 0.79 |
| THRG.L | BlackRock Throgmorton Trust plc | 0 | 1.41 | 1.4 |
| Low | High | |
| Unlevered beta | 0.8 | 0.98 |
| Relevered beta | 0.81 | 1 |
| Adjusted relevered beta | 0.87 | 1 |
ICGT.L's CAPM model and how its cost of Equity is calculated
The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.
This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.
Here’s how we figure out the cost of equity for ICGT.L:
cost_of_equity (10.60%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (0.87) + risk_adjustments (0.25%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.